Actual classification of imported goods prevails over misdeclaration, so customs exemption for Heavy Melting Scrap was denied.

Imported goods must be classified according to their actual physical nature and admitted description; on examination they were found to be rails, not Heavy Melting Scrap as declared. The misdeclaration was supported by the importer's own letter acknowledging cut rails had been declared as HMS Scrap, so the Tribunal's finding that the goods were Heavy Melting Scrap was erroneous. As a result, the customs exemption under Notification No. 21/2002-Cus was not available, and the Assessing Officer's classification and denial of exemption were restored.

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Issues: Whether the imported goods were correctly classified as Heavy Melting Scrap under Heading 7204 or as Rails under CTH 7302, and whether the customs exemption under Notification No. 21/2002-Cus (Sl. No. 200) was available.

Analysis: The imported goods were found on examination to be Rails and not Heavy Melting Scrap as declared. The respondents' own letter requested condonation of the misdeclaration and acknowledged that cut Rails had been declared as HMS Scrap, which supported the conclusion that the declaration did not reflect the true nature of the goods. The Tribunal's finding that the goods were Heavy Melting Scrap was therefore held to be erroneous.

Conclusion: The goods were not classifiable as Heavy Melting Scrap and the exemption benefit was not available; the classification made by the Assessing Officer was restored.

Final Conclusion: The customs authorities' reclassification and denial of exemption were upheld, and the Tribunal's order was set aside.

Ratio Decidendi: Classification of imported goods must follow their actual physical nature and admitted description, and an exemption based on a misdeclared description cannot be sustained.

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